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Introduction
The home services sector in India is getting a major boost with Urban Company’s public debut. As of midday on September 11, 2025, the Urban Company IPO has already seen impressive interest from investors, building on a solid start the day before. This offering from the Gurugram-based platform, known for connecting users with professionals for everything from cleaning to beauty treatments, is turning heads. With subscription numbers climbing and a healthy grey market premium, it is worth exploring what this means for the market and potential shareholders. Let us break it down step by step.
What Urban Company Brings to the Table
Urban Company, founded in 2014 by Abhiraj Singh Bhal, Varun Khaitan, and Raghav Chandra, has transformed how people access home and beauty services. The company runs a tech-driven marketplace that matches customers with trained professionals for tasks like plumbing, pest control, skincare, and appliance repairs. It also sells its own branded products under Native, such as water purifiers and electronic door locks.
Operating in 47 cities in India plus locations in the UAE, Singapore, and a joint venture in Saudi Arabia, Urban Company boasts a network of over 57,000 service partners as of June 2025. Its app emphasizes quality, with features like background checks, training programs, and real-time tracking. Financially, the company turned profitable in fiscal 2025, reporting revenue of about 1,145 crore rupees and a net profit of 240 crore rupees, aided by a deferred tax credit. This shift from earlier losses highlights its maturing business model in a market estimated at 5,210 billion rupees, growing at 10 to 11 percent annually through 2030.
Details of the Urban Company IPO
The IPO aims to raise 1,900 crore rupees at a price band of 98 to 103 rupees per share. It includes a fresh issue of shares worth 472 crore rupees and an offer for sale of 1,428 crore rupees by existing investors like Accel India, Elevation Capital, Bessemer India Capital Holdings II Ltd, Internet Fund V Pte Ltd, and VYC11 Ltd. At the upper end, the company’s valuation stands at around 14,790 crore rupees.
The lot size is 145 shares, meaning retail investors need at least 14,935 rupees to bid for one lot, up to 1,94,155 rupees for the maximum of 13 lots. Book-running lead managers include Kotak Mahindra Capital Company, Morgan Stanley India Company, Goldman Sachs India Securities, and JM Financial. The registrar is MUFG Intime India.
Proceeds from the fresh issue will fund technology upgrades, cloud infrastructure, office leases, marketing, and general corporate needs. Urban Company raised 854 crore rupees from anchor investors on September 9, including funds from Government Pension Fund Global, Nomura, Fidelity, and domestic mutual funds like those from SBI and ICICI Prudential.
Subscription Status and Market Response
The IPO opened on September 10 and will close on September 12. On day one, it was subscribed 3.13 times overall, with retail leading at 7 times, non-institutional investors at 4.16 times, and qualified institutional buyers at 1.31 times.
By midday on September 11, subscriptions had jumped to 5.34 times overall. Retail investors showed even stronger enthusiasm at 11.85 times, non-institutional at 9.02 times, and institutional buyers at 1.32 times. The employee portion was subscribed to 9.31 times, with a 9 rupee discount. Some reports indicate it could be higher, around 6 to 7 times, as bidding continues.
In the grey market, shares are trading at a premium of 38 to 41 rupees, pointing to a potential listing price of 141 to 144 rupees, or a gain of about 38 to 40 percent over the upper band. This reflects positive sentiment amid India’s booming IPO market.
Analyst Views on the Offering
Experts have weighed in with mostly favorable outlooks, though with caveats on valuation. Deven Choksey Research recommends subscribing, citing fair pricing at 12.4 times trailing twelve-month enterprise value to sales compared to peers, and growth potential from rising urban spending.
Anand Rathi suggests subscribing for the long term, noting a price-to-earnings ratio of 65.7 times fiscal 2025 earnings and strong network effects that drive customer loyalty.
Canara Bank Securities also advises subscribing to long-term, emphasizing the company’s role in formalizing the fragmented home services sector and its high repeat rates.
ICICI Direct gives a neutral rating, viewing the valuation as in line with similar platforms but highlighting room for profitability gains.
Arihant Capital Markets recommends subscribing for listing gains, praising the tech platform and hyperlocal focus.
Master Capital Services sees long-term value in the expanding market, while SBI Securities points to improving profitability and expected EBITDA breakeven in fiscal 2026.
Gaurav Garg from Lemonn Markets Desk urges caution, calling it a high-risk bet due to the high price-to-earnings ratio of over 60 times and most funds going to sellers via the offer for sale.
Risks and Opportunities Ahead
Urban Company operates in a largely unorganized market with low online penetration, under 1 percent, offering huge growth scope. Plans include expanding cities, upskilling professionals, and innovating categories. International segments add diversification.
However, challenges include competition from local providers and platforms like competitors in the space, regulatory shifts, and dependence on service quality. Past losses and thin margins before recent profits are concerns, as are potential economic slowdowns affecting discretionary spending.
Recommended Readings
To deepen your understanding of IPOs and startups, check out these books:
- “The Intelligent Investor” by Benjamin Graham offers timeless advice on value investing.
- “One Up On Wall Street” by Peter Lynch shares insights on spotting opportunities in the market.
- “The Lean Startup” by Eric Ries explores building scalable businesses, relevant to companies like Urban Company.
FAQ
Q1: What is the price band for Urban Company IPO?
A: It is set at 98 to 103 rupees per share.
Q2: When does the Urban Company IPO close?
A: Subscription ends on September 12, 2025.
Q3: What is the current subscription status?
A: As of midday September 11, it is 5.34 times overall, with retail at 11.85 times.
Q4: What is the grey market premium today?
A: Around 38 to 41 rupees, indicating a 38 to 40 percent listing gain.
Q5: When will shares be listed?
A: Tentatively on September 17, 2025, on BSE and NSE.
Q6: Should I subscribe to Urban Company IPO?
A: Analysts mostly recommend subscribing, especially for long-term gains, but consider the valuation and risks.
Q7: What will the funds be used for?
A: Technology development, infrastructure, marketing, and general purposes.
Final Thoughts on Urban Company IPO
As the Urban Company IPO heads into its final day, the robust subscription and positive analyst feedback suggest confidence in its model. For those betting on India’s digital economy and the shift to organized services, this could be an appealing entry. Still, with valuations on the higher side, it suits investors with a long view. Watch for the allotment on September 15 and listing on September 17 to see how it performs. In a year of strong IPO activity, Urban Company stands out as a story of tech meeting everyday needs.
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